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The City of London Corporation is exploring bringing in outside investors to help finance future housing projects, as the Square Mile’s governing body seeks to tackle a funding shortfall.
The City’s assets include renowned sites such as Guildhall, the Old Bailey courts and the Grade II-listed Barbican estate, as well as Roman amphitheatre ruins, Hampstead Heath and Epping Forest.
But disrepair among its 1,800 social homes across seven boroughs in the UK capital has become a sore point for the City, which is confronting an £84mn gap in its funding for housing improvements.
A meeting this Friday is due to allocate £152mn of funds to support a ten-year renovation scheme for its affordable homes, which the corporation has admitted publicly do not meet consumer standards.
Two people familiar with the situation said Chris Hayward, the corporation’s policy chair, had discussed bringing in an outside investor, potentially as a longer-term solution once some residential properties had been improved to make the City’s asset base more attractive.
Three people said the corporation had taken the view that outside investors would only be considered for future housing schemes and redevelopment programmes, not repair work on existing housing stock.
The plans remain at a tentative stage but could include the corporation either entering a joint venture with a developer or considering long leases of some of its land for redevelopment, two of the people said. The corporation has so far resisted calls to sell off assets to fund its housing works.
If deals can be reached they would represent the first instance of outside capital for housing in the corporation’s nearly 1,000-year history — although it already partners with developers on office buildings.
As well as being the local authority landlord for 1,800 social rented homes, the corporation manages 900 leasehold properties across London, which has long faced severe housing shortages and affordability pressures.
Last week the corporation said the Smithfield and Billingsgate meat and fish markets would move to Albert Island, near City airport in London Docklands, creating more than 2,200 jobs.
The current site of Billingsgate, near Canary Wharf, has been identified as a location for 4,000 new homes, but the corporation lacks the funds to invest in and regenerate the area.
In published documents, the corporation has said it needs £205mn to address the disrepair across its estates and ensure some buildings now comply with fire and electrical regulations.
More than half of that sum is required at its Grade II-listed Golden Lane Estate near the Barbican, which was completed in the mid-1960s.
Although the corporation has identified an £84mn shortfall that cannot be matched by its housing revenue, it has no plans to increase business rates to cover the costs. The corporation operates its own police force and said “any funds raised from the business rates premium are allocated to security”.
In a statement the corporation said it was “already investing over £110mn in our 12 housing estates” and “delivering wide-ranging improvements including new windows, kitchens . . . [and] and electrical enhancements”.
“We will provide further substantial investment through our housing improvement plan, which is currently being developed,” it added. “In common with all social housing providers, we have to ensure we have viable, long-term solutions to allow us to continue to invest in our housing and provide affordable homes and that requires us to carefully consider the viability of all options for investment. This includes potential partnerships with developers and investors.”